M&S cyber incident hits Sosandar sales as it returns to growth

Sosandar has reported a strong return to revenue growth in the first quarter of its new financial year, but warned that ongoing disruption at Marks & Spencer, one of its largest third-party partners, will weigh on full-year sales.

The womenswear brand generated net revenue of £9.5 million, up by 15%, during the first quarter of 2026. Sosandar.com also returned to revenue growth, with sales up 15% as traffic, conversion and order volumes all increased.

This growth follows a year in which the company made strategic changes to shift away from price promotions, resulting in a 20% dip in full-year revenue to £37.1 million for FY25 (year ended 31 March 2025), down from £46.3 million the previous year. However, gross margin improved from 57.6% to 62.1%, helping deliver adjusted profit before tax of £200,000 (compared to a £300,000 loss in FY24), excluding one-off warehouse relocation costs.

The reported loss before tax was £100,000, following audit adjustments including a £400,000 stock write-down and £0.1 million of additional one-off costs related to the warehouse move. Sosandar maintained a strong net cash position of £7.3 million at year-end, after self-funding the opening of its first six physical stores.

Ali Hall and Julie Lavington, Co-CEOs, said: "During the last year we’ve strengthened the foundations of the business, which will enable us to deliver our growth and profit ambitions going forwards. Taking the decision to reduce price promotions has resulted in an expected reduction in revenue but significantly improved margins and cash generation which, in turn, has allowed the Group to maintain a robust balance sheet and self-fund its growth plan."

The brand’s entry into physical retail was marked by six new stores during the year, with market town locations showing a quicker trajectory to profitability compared to shopping centre sites. Sosandar said it will pause further openings to focus on getting the current store portfolio profitable.

It also signed a licensing deal with NEXT for a Sosandar homeware line, expanding on the strong performance of its clothing partnership with the retailer.

In Q1 FY26, gross margin further improved to 65%, and the business remained cash generative, increasing its cash position to £8 million as of 30 June 2025.

However, due to ongoing disruption at M&S and the strategic decision to pause store expansion, Sosandar has revised down its FY26 guidance. It now expects revenue of £43.6 million (previous market expectations were £46.2 million) and profit before tax of £400,000 (versus previous expectations of £1.5 million).

Hall and Lavington added: "We believe we are now at an inflection point, with the foundations laid for profitable, cash generative growth, and we have returned to revenue growth in Q1 FY26. We will continue to leverage our brand equity and scale the business through our multiple channels and are excited for what lies ahead for Sosandar."